Local Government Magazine

NZTA’s Procurement update

NZTA’s Procurement Update - Featured Image - Local Government - December 2017

Caroline Boot from Clever Buying explains what the changes mean.

Amendments to the NZTA’s Procurement Manual have just been released and will come into effect on March 1, 2018. These are strongly supported by the updated NZQA Procurement Qualification and its associated training, which already provides a comprehensive and aligned blend of NZTA and NZ government procurement practices.
The main aim of the manual and qualification updates has been to align the NZTA’s processes to the Government Rules of Sourcing, which are mandatory for hundreds of government agencies and provide a good practice guide for councils.
This welcome alignment brings together the two most effective models of procurement practice that affect every aspect of significant procurement in our councils.
Aligning the guides
All councils, as Road Controlling Authorities, are required to follow NZTA procurement processes for their significant procurements for transport. Government’s Mandatory Rules for Procurement have also traditionally influenced council procurement.
Since the Mandatory Rules were updated with the Government Rules of Sourcing in 2013, councils have become increasingly perplexed with reconciling these two different sources of procurement guidance.
Inevitably, although both NZTA and NZ government procurement processes are individually very sound, there were gaps and inconsistencies between the practices espoused by these two agencies. For example, until now the NZTA’s Procurement Manual has been silent on advice for the minimum timeframes for responses; but the Government Rules of Sourcing gave very specific advice aimed at reducing the risks to both buyers and sellers of hastily-generated, inaccurate responses.
The new NZTA’s Procurement Manual emphasises that the Five Principles of Government Procurement should be considered on every procurement; and that the Rules of Sourcing provide a flexible framework for all government agencies – including councils – to apply standards of good practice to procurement.
There’s a stronger emphasis on value for money rather than cheapest price. This means that council staff need to plan procurements by considering all the costs and benefits that may impact their procurements. Sustainability, total cost of ownership, and consideration of social and environmental impacts must take their place alongside traditional project-focused non-price attributes in decision-making.
Collaboration between purchasing agencies is encouraged within the updated NZTA manual. Opportunities for shared services, better alignment of maintenance contracts, and coordination of construction processes to avoid re-work are all areas that will contribute to better value for council expenditure.
Good practice
Importantly, designing a procurement process (including attributes and weightings) that is appropriate for the risk and complexity of the project is a skill that needs development in council procurement staff.
Too often in the past, the critical tools used to select suppliers have been recycled from previous requests for tender (RFTs) without proper analysis of the drivers for value for money.
The NZTA’s Procurement Manual (and its predecessor, the Competitive Pricing Procedures Manual) has been the foundation of good procurement practice across local government since the early 1990s.
But manuals, policies and strategies, by themselves, only ‘talk the talk’. Although helpful as reference guides, these documents seldom make a difference to day-to-day practices. It takes training in real-world situations, plus effective on-job tools to embed good practice and compliance into the critical activities of planning procurements, developing RFT documents, processing and evaluating tenders.
Qualification & training
The NZTA recognised this decades ago, by requiring a NZQA-qualified tender evaluator to be on the tender evaluation team for all significant projects attracting NZTA funding. To get qualified, procurement professionals need to demonstrate effective procurement practice – to the requirements in the NZTA Procurement Procedures Manual and the Government Rules of Sourcing – in their work environments.
Recent updates to the NZQA Level 6 Procurement Qualification have made it relevant to all of public sector procurement (not just transport). That NZQA-approved generic qualification, and its associated training, is the key for councils to ensure their procurement staff ‘walk the walk’ by embedding good procurement practice mandated by both government and NZTA in every aspect of significant procurement.

• Caroline Boot is a qualified assessor for the NZQA Level 6 Procurement Qualification and has developed the two-day Clever Buying Procurement workshop. 021 722 005. www.CleverBuying.com

This article was first published in the December 2017 issue of NZ Local Government Magazine.

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